GAS PRICES, HURRICANES KEEP DINERS HOME

The National Restaurant Association's Restaurant Performance Index fell in August as operator optimism declined. Premium prices at the pump and Hurricanes Katrina and Rita led to the sharpest decline in expectations in the index's three-year history. The expectations index stood at 100.4 in August, the fifth decline in the past six months. The current situation index fell 0.6 percent to 100.4 during the month. The health of the restaurant industry is measured in relation to a steady level of 100. The data is derived from the association's monthly Restaurant Tracking Survey.

COULD REIT EXPANSION DECLINE?

The total estimated cost of shopping center REIT development and redevelopment grew 11.5 percent in the second quarter from the first quarter and 41.2 percent from the same period last year, said Prudential Equity Group LLC analyst James Sullivan in a quarterly update. Prudential said it considered Developers Diversified, Kimco and Recency to be “aggressive developers.” Each has at least 6.5 percent of total in-service square footage. But expansion could decline as a result of rising rates, Sullivan believes. “Although we have yet to see any evidence that this scenario is beginning to unfold, investors should prepare for the possibility,” he said.

DEVELOPMENT PIPELINE AT END OF Q2 2005

Estimated % of Gross Real
Company Name Cost (mill.) Estate Assets Sq. Ft. (000) % In Service. % Funded % Yield
DDR $379 5.7 4,678 6.5 60.3 11.0
Federal Realty 174 6.3 NA NA 51.1 12.0
Kimco Realty* 1,005 19.8 5,660 10.2 50.4 11.5
New Plan Excel 243 NA NA NA NA 10.6
Regency Centers 502 15.9 2,899 9.5 53.4 9.9
*Kimco square foot figures include only KDI projects.
Source: Prudential Equity Group LLC/Company reports

THE BIERI REPORT: NEW JERSEY

Retail in the New Jersey suburbs of New York is dominated by malls and freestanding shops along busy roadways. Such powerhouses as Westfield Garden State Plaza, Woodbridge Center, Willowbrook Mall, Rockaway Town Center, Bridgewater Commons, Menlo Park Mall and Freehold Raceway Mall are huge economic engines. Garden State Plaza is one of the nation's mega malls with tenants including Neiman Marcus. The Mall at Short Hills is a unique center with many luxury shops and high-fashion anchors.

Successful properties are continually reinvented to stay vital in this competitive market. Jersey Gardens Metro Mall provides a Mills type venue, and Mills is building its long-awaited Meadowlands Xanadu across from Manhattan. Riverside Square is currently being renovated; its goal is to build depth in luxury. Several small lifestyle projects are coming onstream, following the success of Shrewsbury Commons; the latest is Tices Corner.

Westfield, N.J., and Edgewater, N.J., show that downtown retail is alive, and Secaucus remains a strong outlet environment.

NEW JERSEY SUBURBS
SHOPPING CENTER RANKING
Bridgewater Commons A
Freehold Raceway Mall B+
Garden State Plaza A
Jersey Gardens Metro Mall B+
Livingston Mall B
Menlo Park Mall A
Monmouth Mall B
Newport Raceway Mall B+
Paramus Park B+
Riverside Square B
Rockaway Town Center B+
The Mall at Short Hills A
Willowbrook Mall A
Woodbridge Center A

The information presented for traffic estimates and regional malls is gained from a variety of sources used in developing the Bieri Market Reports. These sources are public and private, and may even include the developers themselves. When traffic counts are not available, grades are determined by reviewing sales of anchor stores and specialty tenants within a subject project, and then comparing those with like projects.

HELP WANTED

In an industry known for high turnover and seasonal work, retailers find it challenging to hire and retain an effective workforce. According to a recent Maritz Poll, retailers can satisfy the needs of of current employees by listening to them. Just what do they want? Some examples below:

Work to be Fun 90%

Improved Communication 38%

Great Brand Image 66%

Discounts 89%

Clearly Defined Role 88%

Flexible Hours 83%

More Feedback 32%

Greater Recognition 35%

Source: Maritz Poll